Costs of Unemployment
Costs of Unemployment
By Michael Mizia
Unemployment can cause many people to lose hope that they wont be able to afford anything anymore. But the one thing people do not know is that even being unemployed can cost a nations government hundreds of thousands of dollars in helping unemployed citizens. According to economicshelp.org, those who are unemployed find it more difficult to get work in the future(known as the hysteresis effect). Citizens who become disinterested in wanting to find work again will cause the government multiple problems as well as themselves. When people get fired or laid off from their jobs, they will most likely become depressed and won’t want to do anything for the first few days of being unemployed. This can cause stress as well as health problems to the individuals. Not only people, but a nation itself can suffer from suffering from unemployment. Having people who are out of work means that a nation’s economy is suffering from a lower GDP than they would if they had no unemployment. A lower GDP for a nation means the economy will be below full capacity this is inefficient and will lead to lower output and incomes.
The government struggles to support so many unemployed americans. According to money.cnn.com, unemployed Americans have cost the Government over half a trillion dollars in unemployment benefits within the last five years. Americans who continue to stay unemployed are just causing the government more trouble by driving them further into debt while trying to help the people who need money. Referring back to money.cnn.com, a study was conducted where the many unemployment programs were extended to see just how much money was going to be spent and upon doing so they found out that by hypothetically increasing how long these programs last the nations GDP would rise by 0.2% and 300,000 jobs would be added
According to a website titled whitehouse.gov, Since its inception in 2008, extended unemployment insurance (UI) benefits have provided critical support to millions of workers and their families. Allowing the unemployment insurance to run out would damage the economy even more than it already is. Failure to extend the unemployment insurance would cost an estimated 240,000 jobs in 2014. Lifting people out of poverty comes with a cost, although the government is saving people from starving and losing everything, they still suffer because they are taking money out that they won’t be able to repay to make sure people are able to continue their lives on a day to day basis without having to worry about money.
In the end, although unemployment can happen to anyone at any time don’t let it frighten you, having jobs open up allow an economy to prosper because there are always people looking for work.
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